About this calculator
The loan payoff calculator tells you how long it will take to clear a debt at your current payment, how much total interest you'll pay, and exactly what extra monthly payments would save. It uses the closed-form amortization formula and correctly handles the edge case where a minimum payment is too low to cover the monthly interest (in which case the balance grows forever).
The payoff formula
Given a current balance B, monthly interest rate r (APR ÷ 12), and monthly payment P, the number of months to payoff is:
n = −ln(1 − r·B / P) / ln(1 + r)
This is only solvable when P > r·B — your payment must exceed the monthly interest, or the loan never amortizes. The calculator surfaces this as a red warning when it applies.
Why extra payments are so powerful
Every dollar of extra payment goes 100% to principal, skipping the interest charge that future months would have applied to that dollar. The result is non-linear. Adding $100/month to a $15,000 credit-card balance at 22% APR can cut payoff time from ~6 years to under 3 and save more than $2,500 in interest.
Avalanche vs snowball
If you have multiple debts, two strategies exist:
- Avalanche — pay extra on the highest-rate debt first. Mathematically optimal; saves the most money.
- Snowball — pay extra on the smallest balance first. Less efficient but generates faster wins and better psychological momentum.
Run this calculator separately for each debt to see the exact savings difference, then pick the approach you'll actually stick with.
What to do about high-APR debt
Anything above ~10% APR is worth attacking aggressively. Options to lower the rate itself:
- Balance transfer to a 0% intro card (typically 12–18 months, 3–5% transfer fee).
- Personal loan at 7–15% APR if your credit is good.
- HELOC if you own a home with equity (much lower rate, but secured by your home — only if you're disciplined).
- Negotiate directly with the lender — credit card companies regularly lower APRs on request, especially if you have a hardship.